The promise of a decentralized financial system is worth a moderate increase in energy consumption.
The Environmental, Social, Governance (ESG) movement is coming for Bitcoin and a host of other cryptocurrencies. This latest iteration of the corporate-responsibility movement has successfully captured public companies and forced a shift of priorities away from shareholder value toward a set of amorphous standards that too often serve as mere proxies for progressive policy goals. If crypto falls to ESG pressure, that will crush much of its global benefit to individuals worldwide.
The main ESG complaint about Bitcoin is its energy consumption. Wall Street and other ESGers see Bitcoin’s energy consumption as wasteful and dirty. Bitcoin currently consumes energy equivalent to the Netherlands, whose residents account for 0.22 percent of the global population, according to estimates.
So nonprofits and the trade press want to “solve” the crypto industry’s alleged “social” and “governance” issues by imposing top-down control via an ESG bureaucracy the way they have with public companies.
Leading crypto publication Coindesk recently explored Bitcoin angst in “How the Bitcoin Industry Is Responding to Wall Street’s ESG Concerns.” The “Bitcoin industry” response has been to placate. Ark Financial and Jack Dorsey’s Square published a white paper with promises of “clean” Bitcoins through renewable energy.